This proposal addresses NIA Research Objective #22 (personality and experimental social psychology), in particular examining decision-making processes in order adults. As people age, their competence at various decisions is questioned more often, but research on how to measure decision-making competence (DMC) reliably and validly in older adults is almost non-existent. Accurately identifying declines in DMC is particularly important for older adults because opportunities to recover from or compensate for poor judgments or decisions diminish over the lifespan. Developing context-sensitive, performance-based measures of DMC will offer a much-needed alternative to clinical interviews and permit strategies regarding decision-aid interventions to be tailored better to individuals' needs. Tailored decision aids will reduce the impact of poor decision making on older adults, as well as on the welfare of others, such as families, friends, and service providers. Another practical implication of developing good DMC measures is that they will allow the identification of a baseline for decision competence in healthier older adults against which special groups of people can be compared (e.g., people with different diseases, medications, living arrangements). Guided by theoretical and empirical work in the fields of gerontology and decision making, the proposed research views DMC as multi-dimensional construct dependent on characteristics of both the decision task and the decision maker. The research aims to develop measures of two important aspects of DMC (comprehension and consistency) and to compare o\older and younger adults' performance in simple and complex decision contexts. Specifically, three hypotheses will be tested: (1) Compared with young adults, older adults perform worse on comprehension and consistency tasks. (2) Both younger and older adults perform worse on complex and simple comprehension and consistency tasks. (3) The difference in performance on complex versus simple tasks is greater for older than younger adults.